All of the talk about Tesla revolves around a few topics:

  • they are burning through money – building cars is hard – that’s why it has been many decades since a new car company came about. They will flame out.
  • they are damn cool, I want one.
  • they are cool, but I worry about running out of a charge.
  • they are cool, but very expensive.

One thing we generally don’t hear much about is how Tesla is way ahead of the game when it comes to how cars will be designed and built in the future. Assuming you believe cars will become more autonomous, more electrified, and more connected in years to come, then the way they are engineered will have to change. And Tesla is way ahead of the game.

Think about pretty much every car on the road today – they are highly complex, and most of the systems and functions were designed independently of one another. They were put together by hardware engineers. There is plenty of software within the car, but it is not for the most part centralized. Think about it in terms of adding new functions to a car. Need a new infotainment system? Design one and plug in it. Need to add traction control? Design it and plug it in. So you add on all of these systems, but each one is unique and adds complexity. Some cars these days have 100+ different processing units.

Tesla on the other hand started a few years ago, and they started from scratch. They consolidated most software functions into a centralized computing platform. Need to add a function, or update a function? Just write some code and send it out over-the-air. Your car updates just like your phone. There still may be features and functions to add that involve adding hardware, but a standardized and simplified architecture gives them a leg up. And as we demand more from our cars – as we ask them to drive themselves and talk to other cars and connect seamlessly with our phones while also making less of an environmental impact upon the planet – Tesla does operate from a position of strength.

Does this mean that Tesla will succeed, or that legacy manufacturers will not? No. That will come down to how well each does at navigating a constantly changing marketplace and a changing planet. But Tesla certainly has a working model which is intriguing.